European share markets have started June on a strong footing on Friday as Italian stocks led the pack after a coalition deal appeared to end three months of political deadlock.
The pan-European STOXX 600 index rose 0.5 per cent in early trading, while German stocks also gained 0.5 per cent and Britain’s FTSE 100 rose 0.6 per cent, reports Reuters.
Italian stocks rallied 2.3 per cent, the standout performers in Europe as Italian banks gained 3.6 per cent.
Recent political uncertainty has roiled the Italian stocks, resulting in a slide of more than 9.0 per cent for the Italian benchmark in May, its worst month since June 2016.
However, Italy’s anti-establishment parties revived coalition plans on Thursday, removing the risk of a repeat vote.
Away from politics, semiconductor stocks were a weak spot after shares in Dialog Semiconductor plunged 16 per cent. The chipmaker said that Apple was planning on cutting smartphone power chip orders, which will shave 5.0 per cent off Dialog’s 2018 revenues.
Peer AMS declined 2.6 per cent, while STMicro edged 0.8 per cent lower.
Elsewhere shares in Deutsche Bank climbed 1.8 per cent higher following a drop of more than 7.0 per cent in the previous session, after a report that the US Federal Reserve last year designated the bank’s US operations to be in “troubled condition”.
On Thursday, S&P downgraded Deutsche Bank’s credit rating to BBB+ from A-.